Former treasurer Peter Costello told a royal commission that despite his financial literacy, he had trouble filling out complex aged care paperwork and has no idea how someone going into a nursing home could be expected to do it.
The federal government uses asset and income tests to determine how much people pay for residential aged care or services provided in their home.
Costello, Australia's longest-serving treasurer of 11 years, said he tried to complete the forms with his family.
"I think I'm reasonably financially literate. I had a lot of trouble filling it in," he told royal commission hearings examining the sector on Sept 16.
"I don't know how a person going into a nursing home would ever be able to fill it in."
Costello believes it is fair to have an assets and income test, but said the paperwork included more than 100 questions across 27 pages.
"This is extremely complex. You can sit down and you can devise the best income and assets test in theory, but can I just urge you, you have got to administer it," he said.
The seven-day hearing is examining how aged care is funded and whether improvements can be made to financial models and regulation.
Costello warned against raiding the $168 billion future fund during the coronavirus pandemic to inject money into the sector.
"This fund, not only is it deriving the Commonwealth income, but it's on the balance sheet and this is where it adds real value," he said.
"At a time when the Commonwealth is borrowing a lot of money, it's got very few financial assets, this would be its biggest financial asset.
"It strengthens the balance sheet and strengthens the credit rating."
On Sept. 14, former Labor prime minister Paul Keating proposed a HECS-style scheme to fund aged care for people in their home.
The commission heard residential care providers receive $11.7 billion a year in Commonwealth subsidies and about $12.4 billion in overall revenue, including residents' contributions.
But counsel assisting the commission, Peter Gray QC, said current reporting requirements mean residential providers aren't adequately revealing how they spend the money.